BILL NUMBER: SB 319	CHAPTERED  09/02/99

	CHAPTER   306
	FILED WITH SECRETARY OF STATE   SEPTEMBER 2, 1999
	APPROVED BY GOVERNOR   SEPTEMBER 1, 1999
	PASSED THE ASSEMBLY   AUGUST 23, 1999
	PASSED THE SENATE   APRIL 29, 1999
	AMENDED IN SENATE   MARCH 25, 1999

INTRODUCED BY   Senator Burton

                        FEBRUARY 8, 1999

   An act to amend Section 106 of the Labor Code, and to amend
Section 329 of the Unemployment Insurance Code, relating to the
economy.



	LEGISLATIVE COUNSEL'S DIGEST


   SB 319, Burton.  Joint Enforcement Strike Force on the Underground
Economy:  citations.
   (1) Existing law authorizes the Labor Commissioner until January
1, 2000, to designate, authorize, and train an employee of any agency
participating in the Joint Enforcement Strike Force on the
Underground Economy to issue citations and to issue and serve a
penalty assessment order, pursuant to specified provisions.
   This bill would extend that authority to January 1, 2006.
   (2) Existing law, until January 1, 2000, authorizes the activities
of the Joint Enforcement Strike Force on the Underground Economy.
   This bill would extend that authority to January 1, 2006.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:


  SECTION 1.  Section 106 of the Labor Code is amended to read:
   106.  (a) The Labor Commissioner may authorize an employee of any
of the agencies that participate in the Joint Enforcement Strike
Force on the Underground Economy, as defined in Section 329 of the
Unemployment Insurance Code, to issue citations pursuant to Sections
226.4 and 1022 and issue and serve a penalty assessment order
pursuant to subdivision (a) of Section 3722.
   (b) No employees shall issue citations or penalty assessment
orders pursuant to this section unless they have been specifically
designated, authorized, and trained by the Labor Commissioner for
this purpose.  Appeals of all citations or penalty assessment orders
shall follow the procedures prescribed in Section 226.5, 1023, or
3725, whichever is applicable.
   (c) This section shall remain in effect only until January 1,
2006, and as of that date is repealed, unless a later enacted
statute, which is enacted before January 1, 2006, deletes or extends
that date.
  SEC. 2.  Section 329 of the Unemployment Insurance Code is amended
to read:
   329.  (a) The director, or his or her designee, shall serve as
Chairperson of the Joint Enforcement Strike Force on the Underground
Economy provided for in Executive Order W-66-93.  The strike force
shall include, but not be limited to, representatives of the
Employment Development Department, the Department of Consumer
Affairs, the Department of Industrial Relations, and the Office of
Criminal Justice Planning.  Other agencies that are not part of the
administration, such as the Franchise Tax Board, the State Board of
Equalization, and the Department of Justice, are encouraged to
participate in the strike force.
   (b) The strike force shall have the following duties:
   (1) To facilitate and encourage the development and sharing of
information by the participating agencies necessary to combat the
underground economy.
   (2) To improve the coordination of activities among the
participating agencies.
   (3) To develop methods to pool, focus, and target the enforcement
resources of the participating agencies in order to deter tax evasion
and maximize recoveries from blatant tax evaders and violators of
cash-pay reporting laws.
   (4) To reduce enforcement costs wherever possible by eliminating
duplicative audits and investigations.
   (c) In addition, the strike force shall be empowered to:
   (1) Form joint enforcement teams when appropriate to utilize the
collective investigative and enforcement capabilities of the
participating members.
   (2) Establish committees and rules of procedure to carry out the
activities of the strike force.
   (3) To solicit the cooperation and participation of district
attorneys and other state and local agencies in carrying out the
objectives of the strike force.
   (4) Establish procedures for soliciting referrals from the public,
including, but not limited to, an advertised telephone hotline.
   (5) Develop procedures for improved information sharing among the
participating agencies, such as shared automated information data
base systems, the use of a common business identification number, and
a centralized debt collection system.
   (6) Develop procedures to permit the participating agencies to use
more efficient and effective civil sanctions in lieu of criminal
actions wherever possible.
   (7) Evaluate, based on its activities, the need for any statutory
change to do any of the following:
   (A) Eliminate barriers to interagency information sharing.
   (B) Improve the ability of the participating agencies to audit,
investigate, and prosecute tax and cash-pay violations.
   (C) Deter violations and improve voluntary compliance.
   (D) Eliminate duplication and improve cooperation among the
participating agencies.
   (E) Establish sharable information data bases.
   (F) Establish a common business identification number for use by
participating agencies.
   (G) Establish centralized, automated debt collection services for
the participating agencies.
   (H) Strengthen civil penalty procedures to allow the strike force
to emphasize civil rather than criminal penalties wherever possible.

   (d) The strike force shall report to the Governor and the
Legislature annually during the period of its existence, commencing
February 1, 1995, regarding its activities.
   The report shall include, but not be limited to, all of the
following:
   (1) The number of cases of blatant violations and noncompliance
with tax and cash-pay laws identified, audited, investigated, or
prosecuted through civil action or referred for criminal prosecution.

   (2) Actions taken by the strike force to publicize its activities.

   (3) Efforts made by the strike force to establish an advertised
telephone hotline for receiving referrals from the public.
   (4) Procedures for improving information sharing among the
agencies represented on the strike force.
   (5) Steps taken by the strike force to improve cooperation among
participating agencies, reduce duplication of effort, and improve
voluntary compliance.
   (6) Recommendations for any statutory changes needed to accomplish
the goals described in paragraph (7) of subdivision (c).
  (e) This section shall remain in effect only until January 1, 2006,
and as of that date is repealed, unless a later enacted statute,
which is enacted before January 1, 2006, deletes or extends that
date.
